Lightning strikes and shark attacks and winning the lottery – Oh my!

None of these are likely to happen to you. (The odds of winning the lottery alone are 175 million to 1.)

Occasionally playing in the rain, swimming in the ocean, or buying a lotto ticket won’t affect your life insurance rate.

But…

Bungee jumping and kayaking and skydiving – Oh my! These 3 are a different story when it comes to determining your life insurance rate!

When you apply for a life insurance policy, the underwriting process involves reviewing a variety of different factors about you – your age, gender, family health history, lifestyle, etc. The underwriters need to help your potential insurer determine what kind of risk you pose to the insurance company.

What are insurance companies looking for? Ideally, someone who is young, healthy, and will not likely need their policy payout soon. These are the individuals who typically enjoy the lowest insurance rates. However, it’s important to note that no matter your age or how healthy you are, if you engage in some risky hobbies, they have the potential to bungee you right out of the easy-to-insure category.

And we’re not even addressing the part where you trust the giant piece of folded up cloth to deploy correctly and carry you safely to the ground! This is textbook risky. (And certainly just one way to look at skydiving – most insurers don’t care that this might be a big check mark on your bucket list.)

When you raise your odds of being in harm’s way, you raise your life insurance rate – and sometimes your inability to be approved for a policy at all. In 2016, 1 in 153,557 skydiving jumps resulted in a fatality in the US. While these odds are not as likely as the odds of getting your cheek pinched by Great Aunt Gladys at Thanksgiving or seeing a brand new Porsche taking up two parking spaces at the mall on Black Friday, it’s a lot more likely than your lottery odds, to be sure.

And willingly leaping out of a plane is going to raise a red flag for any insurer.

Some other risky hobbies that may have an impact on your life insurance rate or policy approval:

Hot air ballooning

Scuba diving

Car racing, boat racing, bike racing

Skiing and snowboarding

Hang gliding

If you enjoy living a bit more adventurously than most, it doesn’t mean that you can’t get life insurance to protect your future and your loved ones. Working with me gives you a distinct and adventurous advantage: you’ll have multiple products and insurers to work with. This isn’t a guarantee for success, but we can embark on this journey together and explore your options. Finding a life insurance policy that suits your lifestyle isn’t an impossible task, but you should take that leap sometime soon. Why not start today? (Parachute optional!)

The emotional cost of losing a loved one can’t be quantified, and knowing how to say goodbye can’t be taught so much as learned. It can be a long and difficult road for many.

Offsetting the financial aspect of that struggle can be done. Not through gimmicks or escapism, but through a real, tangible solution: Final expense plans.

A traditional funeral can cost up to $10,000. If that number seems a bit outrageous, look at how quickly some of the basic items and services can add up:

Cost of the grave site: $1,000

Cost to dig the grave: $600

Cost of a casket: $2,300

Cost of a grave liner/outer burial container: $1,000

Cost of a headstone: $1,500

That’s already $6,400… and says nothing of payment of mortician’s services, use of the funeral home, the fee for the funeral director, the cost of flowers, and more details that one never thinks about until they’re in a position where they need to think about it. These costs will vary by geographic location, but one thing you can count on is that the emotional cost you or your loved ones experience later could be compounded with financial cost that could be avoided with a bit of careful preparation now.

In the face of losing someone you love, finances might be the last thing on your mind. With a solid final expense plan, you can keep it that way.

Ever hear the old story of the 7 years of plenty followed by 7 years of famine?

In the years when there was an abundance of crops, it was wise to store up as much as possible in preparation for the years of famine. However, if instead of saving you ate it all up during the 7 years of abundance, the result would be starvation for you and your family during the 7 lean years. This might be an extreme example in our modern, First World society, but are you “eating it all up” now and not storing enough away for your retirement?

The definition of retirement we’ll be using is: “An indefinite period in which one is no longer actively producing income but rather relies on income generated from pensions and/or personal savings.”

According to this definition, the “years of plenty” would be the years that you are still working and generating income. While you still have regular income, you can set aside a portion of it to save for retirement. This amount is called the “Personal Savings Rate.”

According to the latest statistics, the personal savings rate for Americans is approximately 2.4% annually. If you compare that with the average during the 1970’s of a 10% annual savings rate, you’ll see it has decreased significantly. This should set off some alarms concerning the impact on your retirement savings.

Suppose you’re looking to retire for at least 10 years (e.g., from 65 years old to 75 years old). Even if you’re planning to live on only half of the income that you were making prior to retirement, you would need to save up 5 years worth of income to last for the 10 years of your retirement. But if you’re currently saving only 2.5% of your income per year, it would take 200 years to save up 5 years of income replacement!

So unless you’ve found the elixir of everlasting life, we’re going to need to do some serious “saving” of the personal savings rate. Is there a solution to this dilemma? Yes. If you’re looking for possible ways to store up and prepare for your retirement, I’d be happy to have that conversation with you today.

A teacher walked into her classroom with a clear jar, a bag of rocks, a bucket of sand, and a glass of water. She placed all the large rocks carefully into the jar.

“Who thinks this jar is full?” she asked. Almost half of her students raised their hands. Next, she began to pour sand from the bucket into the jar full of large rocks emptying the entire bucket into the jar.

“Who thinks this jar is full now?” she asked again. Almost all of her students now had their hands up. To her student’s surprise, she emptied the glass of water into the seemingly full jar of rocks and sand.

“What do you think I’m trying to show you?” She inquired.

One eager student answered: “That things may appear full, but there is always room left to put more stuff in.”

The teacher smiled and shook her head.

“Good try, but the point of this illustration is that if I didn’t put in the large rocks first, I would not be able to fit them in afterwards.”

This concept can be applied to the idea of a constant struggle between priorities that are urgent versus those that are important. When you have limited resources, priorities must be in place since there isn’t enough to go around. Take your money, for example. Unless you have an unlimited amount of funds (we’re still trying to find that source), you can’t have an unlimited amount of important financial goals.

Back to the teacher’s illustration. Let’s say the big rocks are your important goals. Things like buying a home, helping your children pay for college, retirement at 60, etc. They’re all important –but not urgent. These things may happen 10, 20, or 30 years from now.

Urgent things are the sand and water. A monthly payment like your mortgage payment or your monthly utility and internet bills. The urgent things must be paid and paid on time. If you don’t pay your mortgage on time… Well, you might end up retiring homeless.

Even though these monthly obligations might be in mind more often than your retirement or your toddler’s freshman year in college, if all you focus on are urgent things, then the important goals fall by the wayside. And in some cases, they stay there long after they can realistically be rescued. Saving up for a down payment for a home, funding a college education, or having enough to retire on is nearly impossible to come up with overnight (still looking for that source of unlimited funds!). In most cases, it takes time and discipline to save up and plan well to achieve these important goals.

What are the big rocks in your life? If you’ve never considered them, spend some time thinking about it. When you have a few in mind, place them in the priority queue of your life. Otherwise, if those important goals are ignored for too long, they might become one of the urgent goals - and perhaps ultimately unrealized if they weren’t put in your plan early on.

First of all, what is insurable interest?

It’s simply the stake you have in something that is being insured – and that the amount of insurance coverage for whatever is being insured is not more than your potential loss.

To say things could become a bit awkward might be an understatement if your insurable interest isn’t considered before you’re deep into the planning phase of a project or before you’ve signed some papers, like a title or a loan.

It’s better for your sanity to understand insurable interest beforehand. Where the issue of insurable interest often arises is in auto insurance. Let’s look at an example.

Let’s say you have a car that’s worth $5,000. $5,000 is the maximum amount of money you would lose if the car is stolen or damaged – and $5,000 would be the most you could insure the car for. $5,000 is your insurable interest.

In the above example, you own the car, so you have an insurable interest in it. By the same token, you can’t insure your neighbor’s car. If your neighbor’s car was stolen or damaged, you wouldn’t suffer any financial loss because it wasn’t your car.

Here’s where it might get a little tricky and why it’s important to understand insurable interest. Let’s say you have a young driver in the house, a teenager, and it’s time for him to get mobile. He’s been saving up his lawn-mowing money for two years and finally bought the (used) car of his dreams.

You might have considered adding your son’s car to your auto policy to save money – you’ve heard how much it can cost for a teen driver to buy their own policy. Sounds like a good plan, right? However, the problem with this strategy is that you don’t have an insurable interest in your son’s car. He bought it, and it’s registered to him.

You might find an insurance sales rep who will write the policy. But there’s a risk the policy won’t make it through underwriting and – more importantly – if there’s a claim with that car, the claim might not be covered because you didn’t have an insurable interest in it. If you want to put that car on your auto insurance policy, the car needs to be registered to the named insured on the policy – you.

Insurable Interest And LendersIf you have a mortgage or an auto loan, your lender is probably listed on your policy. Both you and the lender have an insurable interest in the house or the car. Over time, as the loan is paid down, you’ll have a greater insurable interest and the lender’s insurable interest will become smaller. (Hint: When your loan is paid off, ask your agent to remove the lender from the policy to avoid any confusion or delays if you have a claim someday.)

Does Ownership Create Insurable Interest?Good question. It might seem like ownership and insurable interest are equivalent – they often occur simultaneously. But there are times when you can have an insurable interest in something without being an owner.

Life insurance is a great example of having an insurable interest without ownership. You can’t own a person – but if a person dies, you may experience a financial loss. However, just as you can’t insure your neighbor’s car, you can’t purchase a life insurance policy on your neighbor, either. You’d have to be able to demonstrate your potential loss if your neighbor passed away. And no it doesn’t count if they never returned those hedge clippers they borrowed from you last spring.

So now you know all about insurable interest. While insurable interest requirements may seem inconvenient at times, the rules are there to protect you and to help keep rates lower for everyone. Without insurable interest requirements, the door is open to fraud, speculation, or even malicious behavior. A little inconvenience seems like a much better option.

Do you dread grabbing the mail every day?

Bills, bills, mortgage payment, another bill, maybe some coupons for things you never buy, and of course, more bills. There seems to be an endless stream of envelopes from companies all demanding payment for their products and services. It feels like you have a choice of what you want to do with your money ONLY after all the bills have been paid – if there’s anything left over, that is.

More times than not it might seem like there’s more ‘month’ than ‘dollar.’ Not to rub salt in the wound, but may I ask how much you’re saving each month? $100? $50? Nothing? You may have made a plan and come up with a rock-solid budget in the past, but let’s get real. One month’s expenditures can be very different than another’s. Birthdays, holidays, last-minute things the kids need for school, a spontaneous weekend getaway, replacing that 12-year-old dishwasher that doesn’t sound exactly right, etc., can make saving a fixed amount each month a challenge. Some months you may actually be able to save something, and some months you can’t. The result is that setting funds aside each month becomes an uncertainty.

Although this situation might appear at first benign (i.e., it’s just the way things are), the impact of this uncertainty can have far-reaching negative consequences.

Here’s why: If you don’t know how much you can save each month, then you don’t know how much you can save each year. If you don’t know how much you can save each year, then you don’t know how much you’ll have put away 2, 5, 10, or 20 years from now. Will you have enough saved for retirement?

If you have a goal in mind like buying a home in 10 years or retiring at 65, then you also need a realistic plan that will help you get there. Truth is, most of us don’t have a wealthy relative who might unexpectedly leave us an inheritance we never knew existed!

The good news is that the average American could potentially save over $500 per month! That’s great, and you might want to do that… but how do you do that?

The secret is to “pay yourself first.” The first “bill” you pay each month is to yourself. Shifting your focus each month to a “pay yourself first” mentality is subtle, but it can potentially be life changing. Let’s say for example you make $3,000 per month after taxes. You would put aside $300 (10%) right off the bat, leaving you $2,700 for the rest of your bills. This tactic makes saving $300 per month a certainty. The answer to how much you would be saving each month would always be: “At least $300.” If you stash this in an interest-bearing account, imagine how high this can grow over time if you continue to contribute that $300.

That’s exciting! But at this point you might be thinking, “I can’t afford to save 10% of my income every month because the leftovers aren’t enough for me to live my lifestyle”. If that’s the case, rather than reducing the amount you save, it might be worthwhile to consider if it’s the lifestyle you can’t afford.

Do you have a recipient in mind for the proceeds of your life insurance policy?

Many people have someone in mind before they purchase their policy. This person or entity can be named as your beneficiary. Naming your life insurance beneficiary helps to ensure that the party you choose gets the proceeds of your life insurance policy, even if your will leaves your estate to someone else. If you’ve decided that you want to provide for a special person or organization through your life insurance policy, it’s important that the beneficiary section will do what you expect.

Here are some simple tips that can help point you in the right direction:

Choosing Your Life Insurance BeneficiaryWho you name as your beneficiary is a deeply personal decision, and there’s no right or wrong answer. Here are some areas to consider:

Family: Spouses, children, siblings, and parents are all very common choices as life insurance beneficiaries. However, children under the age of 18 are a special case. Life insurance companies won’t pay a death benefit to a minor, so you may want to choose a responsible adult whom you trust with the welfare of your child.

Legal guardian: If your life insurance policy does name a minor as your beneficiary, your insurer may require that you designate a legal guardian.

Business / Key Person Life Insurance: In business partnerships, other partners can be a named beneficiary. Businesses also sometimes insure the life of a key employee with the business as the beneficiary.

Friends, etc: You can also name a friend as a beneficiary – assuming your friend isn’t a minor.

Note: Contrary to popular belief, you can’t name a pet as your beneficiary — but you can name someone you’d trust to care for your pet. (Sorry, Fluffy.)

Multiple Beneficiaries and Contingent BeneficiariesYou can name multiple beneficiaries for your life insurance policy, but when doing this, it’s better to use percentages rather than fixed dollar amounts. For permanent life insurance policies, like whole life insurance and universal life insurance, the death benefit payout amount can change over time, making percentages a better strategy for multiple beneficiaries.

You can also name contingent beneficiaries. Think of a contingent beneficiary as a back-up beneficiary. In the event that your primary beneficiary passes before you do (or at the same time), the proceeds of your policy would then go to the contingent beneficiary.

Final ThoughtsAvoid using general designations, such as “spouse” or “children” as your beneficiary. Spouses can change, as divorce statistics remind us, and you never know which long-lost “children” might appear if there’s a chance of a payday from your life insurance policy. In the very best case, general designations will cause delays in payment to your intended beneficiaries.

Choosing a life insurance beneficiary isn’t necessarily complicated, but there’s some room for error in certain situations. While the decision is always yours to make, it’s best to discuss your options with your financial professional to help make sure the settlement goes smoothly and your wishes are honored.

On Monday mornings, we’re all faced with a difficult choice.

Get up a few minutes early to brew your own coffee, or sleep a little later and then whip through a drive-thru for your morning pick-me-up?

When that caffeine hits your bloodstream, how you got the coffee may not matter too much. But the next time you go through a drive thru for that cup o’ joe, picture your financial strategy shouting and waving its metaphorical arms to get your attention.

Why? Each and every time you indulge in a “luxury” that has a less expensive alternative, you’re potentially delaying your financial independence. Delay it too long and you might find yourself working when you should be enjoying a comfortable retirement. Sound dramatic? Alarmist? Apocalyptic? But that’s how it happens – one $5 peppermint mocha at a time. This isn’t to say that you can’t enjoy an indulgence every once in a while. You gotta “treat yourself” sometimes, right? Just be sure that you’re sticking with your overall, long-term strategy. Your future self will thank you!

Here are 3 ways to shift from indulgence to independence:

1. Make coffee at home. Reducing your expenses can start as simply as making your morning coffee at home. And you might not even have to get up earlier to do it. Why not invest in a coffee pot with a delay brewing function? It’ll start brewing at the time you preset, and what’s a better alarm clock than the scent of freshly-brewed coffee wafting from the kitchen? Or from your bedside table… (This is a judgment-free zone here – do what you need to do to get up on time in the morning.)

Get started: A quick Google search will yield numerous lists of copycat specialty drinks that you can make at home.

2. Workout at home. A couple of questions to ask yourself:

1) Will an expensive gym membership fit into your monthly budget?
2) How often have you gone to the gym in the last few months?

If your answers are somewhere between “No” and “I’d rather not say,” then maybe it’s time to ditch the membership in favor of working out at home. Or perhaps you’re a certified gym rat who faithfully wrings every dollar out of your gym membership each month. Then ask yourself if you really need all the bells and whistles that an expensive gym might offer. Elliptical, dumbbells, and machines with clearly printed how-tos? Yes, of course. But a hot tub, sauna, and an out-of-pocket juice bar? Maybe not. If you can get in a solid workout without a few of those pricey extras, your body and your wallet will thank you.

Get started: Instead of a using a treadmill inside the gym, take a walk or jog around your local park each day – it’s free! If you prefer to work out at a gym, look into month-to-month membership options instead of paying a hefty price for a year-long membership up front.

3. Ditch cable and use a video streaming service instead. Cable may give you access to more channels and more shows than ever before, but let’s be honest. Who has time to watch 80 hours of the greatest moments in sports every week? Asking yourself if you could cut the cable and wait a little longer for your favorite shows to become available on a streaming service might not be a bad idea. Plus, who doesn’t love using a 3-day weekend to binge-watch an entire series every now and then? There’s also the bonus of how easy it is to cancel/reactivate a streaming service. With cable, you may be locked into a multi-year contract, installation can be a hassle (and they may add an extra installation fee), and you can forget about knowing when the cable guy is actually going to show up.

Get started: Plenty of streaming services offer free trial periods. Go ahead and give them a try, but be careful: You may have to enter your credit card number to access the free trial. Don’t forget to cancel before your trial is over, or you will be charged.

Taking time to address the luxuries you can live without (or enjoy less often) has the potential to make a huge impact on your journey to financial independence. Cutting back here and investing in yourself there – it all adds up.

Are you feeling the gravity of this checking account situation yet?

All of the money lessons from Parts 1 and 2 dealt heavily with the importance of helping you make sure that all of your money isn’t just sitting in your checking account where it’s neither growing nor working for your future. However, there are a couple of important money-saving details to consider before emptying your checking account.

1. Does your personal bank have any kind of fee attached to the minimum amount of money in your checking account? Staying on course to your financial goals can be tough enough, but when you’re hit with a surprise fee from your bank, can that feel like losing vital g-force in the right direction? Americans paid an average of $53 per person below with your bank’s unique rules to avoid those course-altering fees via your checking account:

Have the minimum balance requirement

Enroll in direct deposit

Open multiple accounts at the same banks

Find free checking elsewhere

2. Do you have enough in your checking account to avoid overdraft fees?$15 Billion. That’s how much Americans paid in overdraft fees last year alone. You could probably build your own space station for that kind of money! (A really small one, at least.) Remember the advice in Part 2 to have accounts for differing money occasions like an Emergency Fund or Fun Fund? These separate, deliberate accounts have the potential to help shield against many unexpected and/or large withdrawals from your checking account. Additional ways to protect yourself from overdraft fees are Overdraft Protection through your bank (but watch out for a fee for the service) or having a small cushion in your checking account, just in case.

Moving your money away from the Black Hole of Checking is important. But ignoring the asteroids of unexpected banking fees headed your way could strip away any potential forward momentum you have to make with saving and getting your money to work for you.

Previously on “The Black Hole of Checking”…

In Part 1, we learned that any object pulled into a black hole will be stretched into the shape of spaghetti through a process called – wait for it – spaghettification. If you threw your shoe into it, the black hole’s gravity would stretch and compress your footwear into an unimaginably thin leather noodle as it was pulled deeper and deeper into the hole. Your shoe would be unrecognizable by the time gravity had its way.

The same thing can happen to the money in your checking account. Having a child, replacing an old automobile with something newer and more reliable, or taking a last-minute trip to see the grandparents in Florida over the holidays, can put a strain on your finances and stretch your reserves farther than you might have anticipated. As new bills create a bigger and bigger hole in your budget, your financial strategy may become something you don’t recognize.

Here in Part 2, let’s talk about how assigning an identity to your money can keep your financial goals on track, and help reduce the stretching of finite resources.

For example, say you keep all of your money in your checking account. Simple is better, right? If you want to go on a family vacation, you’ll just withdraw the funds from your account. Paying in cash to secure a “great” package deal up front? You’re all over that. But what happens if you pick up some souvenirs for Uncle Bob and Aunt Alice? Hmmm…if you get something for them you’ll have to get something for Greg and Susan too. (You’ll never make that mistake again.) And you just have to try that chic little cafe that you read about – you may never pass this way again. (But how can they get away with charging that much for a mimosa?!) Buy One, Get One all day pass at “The Biggest Miniature Museum in the World”? Let’s do it!

When you’re on vacation – having fun and enjoying yourself – it might be hard to resist taking advantage of unique experiences or grabbing those unusual gifts you didn’t account for. On the other hand, you may have no problem being thrifty when travelling, but what if someone gets sick or injured and needs hospital care on the road, or the car breaks down, or there is unexpected bad weather and you have to stay an extra day or two at the hotel?

After it’s all said and done, when you return home from your fun-filled trip, you may find a gaping hole where you had a pile of cash at the beginning of the month. If you had given your money a specific role before you planned your vacation, you may not have had such a shock when you got home – and you can enjoy your memories knowing you stayed on track with your financial goals.

Give your money identity, purpose, and the potential to grow by separating it into designated accounts. Try these 3 for starters:

1. Emergency Fund. Leaky roof? Flat tire? Trip to the emergency room? Maybe you’re great at resisting impulse buys (like those fabulous shoes you spied the other day), but sometimes things happen that are out of your control. Your emergency fund is for situations like these. Unexpected, unplanned-for expenses can derail a financial strategy very quickly if you’re not prepared.

The most important thing to keep in mind about this account? Do. Not. Touch. It. Unless there’s an emergency, of course. Then replace the money in the account as quickly as possible until it’s fully funded again.

How much should you keep in your emergency fund? A good rule of thumb is to shoot for at least $1,000, then build it to 3-6 months of your annual income. However much you decide suits your financial goals, just make sure you aren’t dipping into it when you don’t have an emergency. (Note: Grabbing a great pair of heels on sale is not an emergency.)

2. Retirement Fund. If you want to retire at some point (and most of us do), this one is a no-brainer. Odds are you’ve already begun to set aside a little something for the day you can trade in your suit and tie for a Hawaiian shirt and a pair of flip-flops, but is your retirement fund in the right place now? Unlike a day-to-day checking account with a very low or non-existent interest rate, your retirement fund should be in a separate account that has some power behind it. You’re taking the initiative to put away money for your future – get it working for you! Your goal should be to grow your retirement fund in an account with as high of an interest rate as you can find.

3. Fun Fund. This category may seem frivolous if you’re trying to stick to a well-structured financial plan, but it’s actually an important piece that can help make your budget “work”! Depending on your priorities, you might contribute a little or a lot to this account, but making some room for fun might make it more palatable to save long-term.

You might try setting aside 10% of your paycheck for fun and entertainment and see how that works – is that too much or not enough? Bonus: this is easy to calculate each month. If you’re bringing in $2,000 per month, put no more than $200 in your Fun Fund.

What you do with your Fun Fund is your choice. Will it be more of a vacation fund or a concert fund? A wardrobe fund or a theme park fund? It’s all up to you. And when the rest of your money has a purpose and is growing for your future, you might feel less guilty about snagging those hot shoes you’ve had your eye on when they finally do get marked down.

Don’t let your goals and your money get lost in a black hole of coulda, woulda, shoulda. What kind of purpose do you want to give your money? I can help!

What’s the difference between a black hole and a checking account?

One is a massive void with a force so strong that anything that enters it is stretched and stretched, then disappears with a finality that not even NASA scientists fully understand.

… And the other is a black hole.

Joking aside, did you know that a black hole and your checking account actually have a lot in common? Spaghettification is the technical term for what would happen to an object in space if it happens to find itself too close to a black hole. The intense gravity would stretch the object into a thin noodle, past the point of no return.

If you don’t have a solid financial strategy, the money in your checking account may be stretched past the point of no return, too. Why? If your money is sitting in “The Black Hole of Checking” for years on end, you may find that as you get closer to retirement, each dollar is spread thinner and thinner (until it disappears).

Where are you storing your retirement fund? If you’re keeping it in your checking account, instead of growing your money, you might just be stretching it impossibly, uncomfortably thin.

Say you already have $10,000 saved for your retirement. A checking account comes with a 0% interest rate. That means a $0 rate of return. Even if you managed to not touch that money for 10 years, you’d still only have your starting amount of $10,000. With inflation, you’d really have less value at the end of the 10 years than you had to start with.

But if you took that $10,000 and put it into an account with a 3% compounding interest rate, after 10 years, your money will have grown to $13,439. And that’s without adding another penny! Can you imagine what kind of growth is possible if you start saving now and contribute regularly to an account with a compounding interest rate?

This is the power of compounding interest – interest paid on interest plus the initial amount. (This is also a huge reason why getting as high of an interest rate as you can is important!)

So what are you waiting for? If all of your money is disappearing into that Black Hole of Checking, maybe this is the exploding star “sign” you’ve been looking for! Don’t “spaghettify” your money. Do the opposite and give it the chance to grow with the power of compound interest.

If worrying means that you suffer twice, millions of people are suffering twice over their finances.

What kind of double-suffering are you experiencing – and are you ready for a way out?

The best way to learn and achieve financial independence is with someone who already knows – an ally to walk the road with you. Someone who has been where you are. Someone with the tools to help you. Contact me today, and together we can get you moving towards financial independence – and some peace of mind.

Marie Kondo is an organization guru.

Her “KonMari” method of organizing and her best-selling book The Life-Changing Magic of Tidying Up sparked a revolution in keeping homes clear of clutter. Kondo’s rule of thumb: Keep only what “sparks joy,” get rid of everything else, and have a designated place for every item brought into the home.

This may work well to clear out those old sneakers you never wear anymore or that tennis racket from 1983 that still looks brand-new (we all know you really intended to take those lessons), but you may end up reaching for the ibuprofen once you hit that unorganized stack of financial documents! A pile of paper may not spark the same joy that your grandmother’s china set or your kid’s childhood art might, but they still need to be kept on hand. And keeping them well-organized could save you hours of anxious searching and help preserve your peace of mind in emergency financial situations.

Getting your financial house in order isn’t an easy task to accomplish on your own. I can help. Contact me today, and together we’ll sit down and examine your current financial situation. And don’t forget to bring that shoebox full of financial papers! We’ll tackle it all together.

Once we’re through, you may even find that having your financial documents in order and filed away safely sparks a little more joy in your home!

We know that for adults, the benefits of being physically active are myriad.

Reducing the risks of heart disease, cancer, type 2 diabetes, high blood pressure, osteoporosis, and obesity are worthy goals we should strive for. But how often do we think of these health concerns when it comes to our kids? They’re just kids, right?

However, statistics show that a large majority (more than two-thirds) of children and adolescents don’t meet this standard. Although it’s typical that physical activity tends to decrease with age, developing an active lifestyle while young will likely influence activity levels into adulthood. For instance, if you used to run half-marathons as a teen, the idea of running a half-marathon now – as an adult – wouldn’t be as jarring as if you had never done that at all.

Studies show that there are several factors that can help increase physical activity in children. The first factor is the parents’ activity level. Simply put, active parent = active child. This is relevant for adults who don’t have their own kids, but have nephews, nieces, or kids they mentor. An adult’s level of activity can help foster the activity levels of the children they influence.

Another factor is getting children involved in a rec league or team sport. By adding these into a child’s weekly schedule, each extra hour per week of practice, games, meets, etc., adds nearly 10 minutes to the average daily physical activity for the child. They’ll never have time for exercise if it’s never scheduled to begin with. (This tactic works for adults, too, by the way.)

This much is true: being physically active while younger will affect the health of a child as they grow into an adult. So whether you have children of your own or children you are connected to, your level of activity can help contribute to building a habit of physical activity which will carry on into adulthood. Here’s to building our health, and our children’s, for the future!

Well, a few billion things probably separate you and me from Bill Gates, but he has a habit that may have contributed to his success in a big way: Bill Gates is a voracious reader.

He reads about 50 books per year.* His reason why: “[R]eading is still the main way that I both learn new things and test my understanding.”

On his blog gatesnotes, Gates recommended Hillbilly Elegy by J.D. Vance, the personal story of a man who worked his way out of poverty in Appalachian Ohio and Kentucky into Yale Law School – and casts a light on the cultural divide in our nation. Gates said,

Melinda and I have been working for several years to learn more about how Americans move up from the lowest rungs of the economic ladder (what experts call mobility from poverty). Even though Hillbilly Elegy doesn’t use a lot of data, I came away with new insights into the multifaceted cultural and family dynamics that contribute to poverty.

We all have stories about our unique financial situations and dreams of where we want to go. And none of us want money – or lack thereof – to hold us back.

What things, ideas, or deeply-ingrained habits might be keeping you in the financial situation you’re in? And what can you do to get past them? I have plenty of ideas and strategies that have the potential to make big changes for you.

Contact me today, and together we can review your current financials and work on a strategy to get you where you want to go – including some reading material that can help you in your journey to financial independence.

We’re using debit cards to pay for expenses more often now, a trend that seems unlikely to reverse soon.

Debit cards are convenient. Just swipe and go. Even more so for their mobile phone equivalents: Apple Pay, Android Pay, and Samsung Pay. We like fast, we like easy, and we like a good sale. But are we actually spending more by not using cash like we did in the good old days?

Studies say yes. We spend more when using plastic – and that’s true of both credit card spending and debit card spending. Money is more easily spent with cards because you don’t “feel” it immediately. An extra $2 here, another $10 there… It adds up.

The phenomenon of reduced spending when paying with cash is a psychological “pain of payment.” Opening up your wallet at the register for a $20.00 purchase but only seeing a $10 bill in there – ouch! Maybe you’ll put back a couple of those $5 DVDs you just had to have 5 minutes ago.

When using plastic, the reality of the expense doesn’t sink in until the statement arrives. And even then it may not carry the same weight. After all, you only need to make the minimum payment, right? With cash, we’re more cautious – and that’s not a bad thing.

Try an experiment for a week: pay only with cash. When you pay with cash, the expense feels real – even when it might be relatively small. Hopefully, you’ll get a sense that you’re parting with something of value in exchange for something else. You might start to ask yourself things like “Do I need this new comforter set that’s on sale – a really good sale – or, do I just want this new comforter set because it’s really cute (and it’s on sale)?” You might find yourself paying more attention to how much things cost when making purchases, and weighing that against your budget.

If you find that you have money left over at the end of the week (and you probably will because who likes to see nothing when they open their wallet), put the cash aside in an envelope and give it a label. You can call it anything you want, like “Movie Night,” for example.

As the weeks go on, you’re likely to amass a respectable amount of cash in your “rewards” fund. You might even be dreaming about what to do with that money now. You can buy something special. You can save it. The choice is yours. Well done on saving your hard-earned cash.

Men and women pay different rates for life insurance from the get-go. And it’s purely the result of statistics.

Life insurance rates are determined largely by life expectancy, so the longer you’re projected to live, the lower your rates might be. Statistically, women live longer: an American woman is expected to live about 81 years to a man’s expected 76 years. Therefore, if qualifying for life insurance was based on life expectancy alone, a man would pay more every time. (However, it’s important to note that gender is only one consideration while you’re applying for life insurance. Other factors include your age and your overall health.)

Now throw this stat into the mix:46% of Americans don’t have any type of life insurance coverage at all. That means far too many people do not have the coverage in place to provide for their loved ones in the event of a sudden tragedy. Nothing to cover final expenses or replace lost income and no inheritance left behind… Finding yourself in financial trouble knows no gender.

When you’re ready to work together to build the tailored policy that takes you, your loved ones, and your goals into account, contact me. Stats are stats, but your unique needs have the potential to shape your coverage and your rate into something unexpected!

If you’re already eyeing the perfect recliner for your retirement, hold that thought. And you might want to sit down. And start rifling through the ol’ couch cushions for a little extra change…

Because here’s a doozy: US women are 80% more likely than US men to experience poverty during their retirement.

Part of this startling retirement savings gap could be due to the unique set of circumstances that women face while preparing for retirement.

One of the most obvious of these unique circumstances? Women live longer. In the US, a woman is expected to live about 81 years vs. a man’s expected 76 years. Women have years longer to live than men, but the troubling percentages above suggest that most women are not even financially prepared to live as long as men are expected to!

This retirement savings gap may look and feel massive, but it can be bridged. And it all starts with a solid life insurance strategy. A tailored strategy has the potential to be beneficial for women and men: Women can help themselves be more financially stable and prepared as they look toward retirement, and men have the potential to provide for the women their lives – even after they’re gone.

Your unique situation and goals all factor in to how you want to kick back when you retire. I’m here to help. When you have a moment, give me a call or shoot me an email.

Ask anyone who’s had a flat tire, a leaky roof, or an unexpected medical bill – having enough money tucked away in an emergency fund can prevent a lot of headaches.

It may seem obvious to create a cushion for unexpected expenses while you’re saving up for retirement, especially if you have kids that need to get to their soccer games on time, a new-to-you home that’s really a fixer-upper, or an injury that catches you off guard. But an emergency fund is still important to keep after you retire!

Does your current retirement plan include an emergency fund for unexpected expenses like car trouble, home or appliance repair, or illness?Only 41% of Americans surveyed said they could turn to their savings to cover the cost of the unexpected. That means nearly 60% of Americans may need to turn to other methods of coverage like taking loans from family or friends or accruing credit card debt.

After you retire and no longer have a steady stream of income, covering unexpected expenses in full (without interest or potentially burdening loved ones) can become more difficult. And when you’re older, it might be more challenging to deal with some of the minor problems yourself if you’re trying to save some money! You’re probably going to need to keep the phone number for a good handyman, handy.

Don’t let an unexpected expense after retirement cut into your savings. A solid financial strategy has the potential to make a huge difference for you – both now and during your retirement.

Contact me today, and together we can put together a strategy that’s tailored to you and your needs.

If you or your partner have ever spent (a lot of) money without telling the other, you’re not alone.

This has become such a widespread problem for couples that there’s even a term for it: Financial Infidelity.

Calling it infidelity might seem a bit dramatic, but it makes sense when you consider that finances are the leading cause of relationship stress. Each couple has their own definition of “a lot of money,” but as you can imagine, or may have even experienced yourself, making assumptions or hiding purchases from your partner can be damaging to both your finances AND your relationship.

Here’s a strategy to help avoid financial infidelity, and hopefully lessen some stress in your household:

Set up “Fun Funds” accounts.

A “Fun Fund” is a personal bank account for each partner which is separate from your main savings or checking account (which may be shared).

Here’s how it works: Each time you pay your bills or review your whole budget together, set aside an equal amount of any leftover money for each partner. That goes in your Fun Fund.

The agreement is that the money in this account can be spent on anything without having to consult your significant other. For instance, you may immediately take some of your Fun Funds and buy that low-budget, made-for-tv movie that you love but your partner hates. And they can’t be upset that you spent the money! It was yours to spend! (They might be a little upset when you suggest watching that movie they hate on a quiet night at home, but you’re on your own for that one!)

Your partner on the other hand may wait and save up the money in their Fun Fund to buy $1,000 worth of those “Add water and watch them grow to 400x their size!” dinosaurs. You may see it as a total waste, but it was their money to spend! Plus, this isn’t $1,000 taken away from paying your bills, buying food, or putting your kids through school. (And it’ll give them something to do while you’re watching your movie.)

It might be a little easier to set up Fun Funds for the both of you when you have a strategy for financial independence. Contact me today, and we can work together to get you and your loved one closer to those beloved B movies and magic growing dinosaurs.